Gold dipped briefly below 1300 yesterday, breaking through the 50 DMA and 38.2% Fibonnaci retracement level on the daily chart before finding some support and closing at 1306. This morning, gold is under pressure again and trading well below 1300, with the 50% retracement level at 1287 the next potential area of support.
The sharp correction suggests that gold is retracing in a Wave 2 phase with Wave 1 taking the price from the 31 December low at 1182 to 1392, a 210 point move.
Equities remain near all time highs and the dollar rally continues, with the price holding well above 80 and oil trading at over $100 a barrel.
Support can be found at 1295-1300, 1280, 1275, 1250-1255, 1237-1240, 1220-1225, 1210, 1200 and 1180. A break of 1180 would have serious bearish implications for gold and suggest a decline to 1000-1050 in the short term, though this now looks unlikely.
Resistance can be found at 1307, 1318-1322, 1330-1332, 1340-1342, 1352-1354, 1392-1395, 1400, 1420 and 1435. The breakout above 1300 suggests an end to the intermediate term down trend and that a significant rally is now developing.
Today's video for subscribers looks at the recent trading in more detail and our targets for this Wave 2 correction.
The sharp correction suggests that gold is retracing in a Wave 2 phase with Wave 1 taking the price from the 31 December low at 1182 to 1392, a 210 point move.
Equities remain near all time highs and the dollar rally continues, with the price holding well above 80 and oil trading at over $100 a barrel.
Support can be found at 1295-1300, 1280, 1275, 1250-1255, 1237-1240, 1220-1225, 1210, 1200 and 1180. A break of 1180 would have serious bearish implications for gold and suggest a decline to 1000-1050 in the short term, though this now looks unlikely.
Resistance can be found at 1307, 1318-1322, 1330-1332, 1340-1342, 1352-1354, 1392-1395, 1400, 1420 and 1435. The breakout above 1300 suggests an end to the intermediate term down trend and that a significant rally is now developing.
Today's video for subscribers looks at the recent trading in more detail and our targets for this Wave 2 correction.